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The slickline services market environment is formed by a wide range of factors, which together have a bearing on the condition of the market. The market forces deeply impact the development of the industry and its direction as well. The first and most important aspect is exploration and production of oil and gas. With the world demand for energy still rising, whereby reliable and efficient slickline services are needed. Extensive reliance of exploration and production enterprises on slickline services for well intervention, maintenance and optimization drives these services in demand.
In the first place, technical innovations in the oil and gas industry have a huge impact on the production of slickline services. Downhole tools, sensors, and data analytics advancements have increased the accuracy and efficiency slickline. This, therefore, boosts the performance of wells as well as running business, which lures investors who are looking for the latest technologies. The integration of the smart technologies in slickline services is accepted as business strategy to increase production and decrease operational costs.
Moreover, the regulatory environment is a major determinant of how this market evolves. Without the extreme rules ruling the oil and gas exploration, environmental protection and workers’ safety the slickline providers’ practices and standards would not be the same. Following these regulations is not only a legal obligation but also represents a contributor to the public's perception of the industry and its sustainability. Industry participants will adjust to the common regulations to continue to exist and grow.
Economic factors moreover carry a considerable weight in the market. The health of the national economy in regions with active petroleum and natural gas activities impact the levels of investment in exploration and production. Economic recession causes a drop in oil and gas companies' capital spending, which may have a direct impact on the demand for slickline services. On the other hand, during the booms of an economy, the oil and gas projects attract more investments leading to the growth of the slickline service sector.
Also, global geopolitical events may have adverse affects on oil price, which in turn affects the slickline services market. Political instability in oil-producing countries or modifications in global oil supply and demand will trigger a price swings. Such fluctuations impact the investment intentions of oil and gas companies who, thereafter, affect the demand for slickline services.
Slickline Services Market Highlights:
Slickline Services Market Scenario
Slickline Services Market share is expected to exceed USD 960 million by the end of 2030, with a CAGR of 5.9% during the forecast period.
Onshore drilling encompasses all the drilling sites on dry land and accounts for 70% of worldwide oil production. Onshore and offshore drilling have some similarities. They function without the difficulty of deep water between the platform and the oil. The rising interventions have resulted in hiking the global crude oil prices. However, it is on the recovery mode, and the progress seems to be at a good pace. Also, the onshore projects are easier to begin. Therefore, trusting this progression related to the crude oil prices, onshore projects are expected to record significant growth and hence, play a major role to drive the demand for slickline services.
The onshore segment is expected to have the maximum share in the market in 2020, even when the pandemic hits the international waters. Onshore drilling encompasses all the drilling sites on dry land and accounts for 70% of worldwide oil production. Investments and discoveries along with global liberalization, and opportunities in the oil and gas market are high. The North American region is estimated to have the maximum share of the slickline services market. Additionally, South America is expecting a high growth rate during the forecast period, and attributes the same to the rapidly increasing oil and gas activities in the region. Slickline Services Market is expected to witness high growth during the forecast period owing to the increasing oil & gas exploration across the world.
The major factors driving the growth of the global slickline services market are the increasing oil & gas exploration and growing efforts towards oil & gas production in mature oilfields. According to the BP Statistical Review of World Energy 2019, the global oil production grew from 92,502 thousand barrel per day (TBPD) in 2017 to 94,718 TBPD in 2018; the global natural gas production grew from 3,677.7 billion cubic meters (BCM) in 2017 to 3,867.9 BCM in 2018. The growth in production of oil and gas can be attributed to the improving global economic conditions. Also, as per the same report, the use of natural gas for electricity generation grew from 5,952.8 terawatt-hour (TWh) in 2017 to 6,182.8 TWh in 2018. The production is expected to grow during the forecast period. In line with the increase in the production of natural gas, the growth in demand for oil and gas has led to an increase in exploration and production (E&P) of oil and gas globally. However, process complexities involved in the slickline services can restrict the growth of the global market.
Slickline Services Market Key Players
The key players operating in the global slickline services market are Schlumberger Limited (US), China Oilfield Services Limited (China), Halliburton Company (US), Weatherford International Plc. (US), Baker Hughes Company (US), AOS Orwell Ltd. (Nigeria), Archer Ltd. (UK), Expro Holdings UK 2 ltd. (UK), National Oilwell Varco (US), Superior Energy Services Inc. (US), Reliance Oilfield Services (US), Altus Intervention (Norway), National Energy Services Reunited Corp (US), HLS Asia Limited (India), and Wellmax (India).
Recent Developments
In April 2020, Beach Energy had announced a termination notice to Diamond Offshore for its year-long offshore drilling program in the Otway basin in Southern Australia with the semi-submersible Ocean Onyx. This was a result of the logistical difficulties caused by the CoVID-19 pandemic. This has pushed for an increase in the drilling and completion activities globally driving the demand for slickline services. So much so, that the market companies are taking on international projects for their expansion. Like, in 2021, Saipem had been awarded new onshore drilling contracts in the Middle East and South America worth USD 70 million.
Many oil & gas companies, such as Schlumberger Limited (US) and Halliburton (US), are focusing on E&P of oil and gas across the world. For instance, in October 2017, Schlumberger, along with Torxen Energy (Canada), signed an agreement with Cenovus Energy Inc. (Canada) to purchase Palliser Block in Canada for carrying out E&P of oil and gas in Canada. Moreover, in August 2019, Halliburton (US) signed a contract with Woodside (Australia) for drilling and completion services of offshore SNE Field, located in Senegal, Africa, for E&P of oil and gas. Such developments are expected to increase the demand for slickline services for retrieving and delivering downhole hardware owing to increasing oil and gas production. Furthermore, as per the data of Baker Hughes, a GE Company (US), the worldwide rig count increased from 2029 rig counts in 2017 to 2211 rig counts in 2018, signifying an increase in the use of slickline services. Such developments have led to an increased demand for slickline services, as these services are being used in the production stage of oil and gas and to further drive the growth of the global slickline services market during the forecast period.
Slickline Services Market Segmentation
The global slickline services market has been segmented based on slickline tools and application. Based on the slickline tools, the market is divided into pulling tools, gauge cutter, downhole bailer, bridge plug, and others. The pulling tools segment is projected to hold the largest share of the market and grow at the highest rate during the forecast period because these tools are used for retrieving seated components such as plug prongs. Almost all pulling tools are equipped with a safety feature so they may release a stuck tool and allow the tool string to be brought to the surface for changes in components. All these factors are responsible for the pulling tools segment holding the highest market share.
Slickline Services Market Regional Analyis
Based on region, the global slickline services market is segmented into Asia-Pacific, North America, Europe, the Middle East & Africa, and South America. North America is estimated to hold the major market share during the forecast period owing to the increasing per capita energy consumption and E&P of oil and gas in the region. According to the data of Baker Hughes International Rig Count, 2019, the rig count in North America increased to 1,223 rig counts in 2018 from 1,082 in 2017. The increase in E&P of oil and gas drives the demand for slickline services as these services are used in retrieval and delivery of downhole tools and helpful in oil and gas production. Furthermore, according to the Annual Energy Outlook 2019, the US is expected to become a net energy exporter by 2020 owing to the rise in the production of oil and gas in the country. Moreover, as per the report, crude oil production is expected to reach 14.0 million barrels per day (b/d) by 2040. Thus, the increasing E&P of oil and gas is expected to drive the demand for slickline services in North America during the forecast period.
Slickline refers to a single strand wire or cable that is launched into a well to deliver or retrieve downhole hardware. The hardware components include plugs, valves, gauges, and other tools that can be adjusted through slickline tools. Slickline services are a part of retrieving downhole tools. Slickline services include operations such as maintenance, removal of downhole waste, terminating flow, and setting up hydraulic packers using sealing plugs. The use of slickline units provides a variety of well intervention market services and measurements that are essential during the time a well is in production. Additionally, slickline services can measure the depth of the well and well perforation.
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